As a result, the desktop computer's operating system will decline as the server operating system increases in importance.

'Network-centric computing is where the explosion is,' said Mary Lee Turner, director of product management for IBM's Greater China group.

With previous versions of its OS/2 server, IBM had nearly doubled its market share in the Asia-Pacific region in the past two years.

But IBM still shipped only 12 per cent of the network operating systems in Asia-Pacific in 1995, according to International Data Corporation (IDC) figures.

Meanwhile, Novell continues to ship nearly half of the server operating systems in Asia-Pacific, with Microsoft Windows NT shipping more than a quarter.

'IBM has been weak in projecting itself into the market,' said Wee Liang-toon, an analyst with IDC. 'It's been maintaining, while Microsoft has been gaining.' With its new OS/2 Warp Server, IBM will try to catch up to its rivals. Company officials tout OS/2 Warp Server's ease of use and capabilities like remote access, and the ability to completely manage any computer from anywhere on the network.

Company officials also claim that OS/2 Warp Server surpasses NetWare because it manages not only files and document printing, but also applications, a claim that Microsoft echoes.

OS/2 Warp Server will sell for HK$6,622. An advanced version will retail for $13,681.

Novell, meanwhile, despite dominating the market, has had a difficult time shaking its reputation as merely a 'print and file sharing server', according to Mr Wee.

That has contributed to the erosion in Novell's overall market share in the region in the past two years. IDC estimated that Novell held 64 per cent of the networking operating system market in Asia-Pacific in 1994. But that share dropped to 48 per cent in 1995.

Microsoft Windows NT upped its market share from 12 per cent to 28 per cent between 1994 and 1995.

Microsoft hopes to gain ground by positioning Windows NT server as an Internet-friendly operating system.

Starting this month, NT server comes bundled with Internet Information Server, which turns the server computer into its own gateway to the Internet.

Novell, by contrast, is pushing Groupwise, a messaging and e-mail software similar to Lotus Notes and Microsoft Exchange, as a natural fit with NetWare.

It also claims that NetWare 4.1's Directory Services (NDS) is unique among server products.

'The directory is like the DNA of the network,' said William Donahoo, an executive in Novell's NetWare division.

NDS also allows users to replicate information about the entire enterprise. That means, for example, that users only need to have one password no matter how they access the NetWare network. IBM plans to match NDS later this year when it announces its Directory and Security Server, an add-on to OS/2 Warp Server. It will give users a global directory service similar to NetWare, as well as added network management and security functions.

A simplified Chinese language version of OS/2 Warp Server will be out in April, with a complex Chinese version ready in May.

The localised versions are a small part of sales, said John Soyring, IBM's vice-president for Personal Software Products, because IBM marketed previous versions of OS/2 Server mostly at multinational corporations.

But with this release, IBM plans to capture small and medium-sized businesses who are less likely to speak and read English in their office environment.

The success of OS/2 Warp Server could rejuvenate IBM's flagging OS/2 desktop operating system product. IBM has spent almost $8 billion on developing and marketing OS/2.

IBM shipped about four million copies of OS/2 Warp desktop operating system last year.

But it has been so far behind that the company still holds only scant overall market share in the desktop operating system field.

OS/2 holds about six per cent of the market for desktop operating systems, compared to nearly 75 per cent for Microsoft Windows 3.x, 95, and NT.

OS/2's failure has been a major embarrassment for IBM, while only entrenching Microsoft as the king of the PC applications and operating systems market.

IBM chairman Louis Gerstner even conceded last year that Microsoft had won the battle.

Ms Turner said that 'rumours' of the imminent death of OS/2 were greatly exaggerated.